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Q: please define the "perpetual bond"

Category: glossary , Asked by: D. V. From Cork, Ireland

A: A bond with no maturity date. Perpetual bonds are not redeemable but pay a steady stream of interest forever. Some of the only notable perpetual bonds in existence are those that were issued by the British Treasury to pay off smaller issues used to finance the Napoleonic Wars (1814). Some in the U.S. Believe it would be more efficient for the government to issue perpetual bonds, which may help it avoid the refinancing costs associated with bond issues that have maturity dates. A perpetual bond is also known as a 'consol'. Since perpetual bond payments are similar to stock dividend payments - as they both offer some sort of return for an indefinite period of time - it is logical that they would be priced the same way. The price of a perpetual bond is therefore the fixed interest payment, or coupon amount, divided by some constant discount rate, which represents the speed at which money loses value over time (partly because of inflation). The discount rate denominator reduces the real value of the nominally fixed coupon amounts over time, eventually making this value equal zero. As such, perpetual bonds, even though they pay interest forever, can be assigned a finite value, which in turn represents their price. Visit NordMarkets

    Is there a site that has suitable for novices you can recommend me of?

    Category: platform by Jonathon B. From Canada

    We recommend you to register to "Dukascopy". They have great tutorials for trading tips and instructions, with simple to understand dialog boxes and instructions. You can totally catch up going through some of them.

    do you know what the "National Savings Stock Register" is?

    Category: glossary by U. X. From Innsbruck, Austria

    a "National Savings Stock Register " is A register of government stocks (gilts) which can be purchased by the public through the Post Office at favourable rates of commission for moderate purchases and sales. Transactions are conducted by mail and interest is paid gross and is taxable. Despite

    please define the "earned income credit"

    Category: glossary by L. G. From United Kingdom

    "earned income credit " is A tax credit for low-income workers. Even workers whose incomes are too small to have paid taxes can get EIC. This credit varies with family size, income and the number of children.

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    please define a "reset margin"
    the "reset margin " is The additional fixed spread above the index underlying a floating-rate security. For example, if a floating-rate note has a rate based on LIBOR plus 0.5%, the 0.5% or 50 basis points would be the reference rate and would not change throughout the life of the note. Visit Forex Club

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